Increased production, cash flow and opportunities
GEOCAN is opportunity driven and heavy oil was an excellent starting point for the Company in its early years. With its low exploration and development costs and high success rates, heavy oil gave us flexibility and allowed us to be self-sufficient, providing the company with steady cash flow. GEOCAN’s intention from the start has been to build a traditional E&P company with a balance of commodities. Now we are increasingly enhancing our asset base, adding high-quality natural gas and medium-to-light oil to our portfolio.
We operate over 80 percent of our production, providing the company with strong control over exploration and production priorities and the flexibility to move quickly to access services. GEOCAN also has a substantial portfolio of undeveloped land - mostly in gas-prone areas – and as a result, our growth potential has never been greater.
From our beginnings west of the 3rd Meridian (Saskatchewan), we began the process of acquiring land ‘west of 4’ (east-central Alberta) and ‘west of 5’ (central Alberta/Rocky Mountain foothills). With the Assure acquisition in 2005, we further established ourselves in a whole new core geographic area – “west of 6” (northeast British Columbia).
Our company size now allows us to attract more prominent industry partners, companies that have their own abilities to command services when required. Through farm-ins and joint ventures, we have gained entry to additional core areas that will accelerate our growth plans.
Historically, GEOCAN has enjoyed a high success rate in drilling. From 1998 to 2005, we participated in 100 wells (drilling, recompletions and re-entries) and our overall success rate in that period averaged 86 percent. In 2005, we drilled 23 gross wells with an 87 percent success rate (nine natural gas, 11 oil wells).
Exemplifying our growth story is the fact that from our first listing in 1998 on the Alberta Stock Exchange (later CDNX and then the TSX Venture Exchange), we moved to the Toronto Stock Exchange (TSX) in December 2003. This created significantly higher liquidity and exposed the company to further financing opportunities and some of Canada’s major investment funds.
Every financing we have done has been at progressively higher prices. From a junior capital pool with 100 percent retail investors, we have transitioned into a company that is now approximately 35 percent institutionally owned with 27 percent of its shareholders outside of Canada. Today, GEOCAN is generating more coverage from more industry analysts than ever before.
In January 2006, GEOCAN was recognized as one of Alberta’s fastest growing companies by Alberta Venture magazine. GEOCAN was 14th on their 2005 list of companies under $20 million in revenue, up from 18th spot on the 2004 list. This was our fourth time on the list in the past five years.